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1.In an open economy, a decrease in national saving the quantity of net capital inflows, and _ __the equilibrium
domestic real interest rate, and the quantity of domestic investment.
A. increases; decreases; decreases B. increases; increases; decreases C. decreases; decreases; decreases D. increases; increases; increases E. leaves unchanged; leaves unchanged; leaves unchanged
2.Increasing the physical capital available to the workforce, holding other factors constant, tends to total output (y) and to average labour productivity (y/l).
A. increase; decrease B. decrease; keep unchanged C. increase; increase D. decrease; increase E. increase; keep unchanged
3.Every year the typical family on Planet Econ consumes ten pizzas, seven pairs of jeans and 20 litres of milk. In 2002 pizzas cost $10 each, jeans cost $40 per pair, and milk costs $3 per litre. In 2003, the price of pizzas went down to $8 each, while the price of jeans and milk remained the same. Between 2002 and 2003, a typical family’s cost of living:
A. increased by 4.5% B. decreased by 4.5% C. increased by 2% D. decrease by 2% E. none of above
4.The excess of government tax revenue over government spending is: A. the government budget surplus B. national saving C. national wealth D. the government budget deficit E. the balanced government budget
5.If workers and employers expecting 3% inflation agree to a three-year nominal wage contract, and inflation turns out to be 5%, then: A. workers gain and employers gain B. workers gain and employers lose C. workers lose and employers gain D. workers lose and employers lose E. none of the above
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